Case 1:12-cv-10576-DJC Document 343 Filed 03/04/21 Page 1 of 7
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`UNITED STATES DISTRICT COURT
`DISTRICT OF MASSACHUSETTS
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`No. 12-CV-10576-DJC
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`WORLDS, INC.,
` Plaintiff,
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`v.
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`ACTIVISION BLIZZARD, INC.,
`BLIZZARD ENTERTAINMENT, INC.,
`and ACTIVISION PUBLISHING,
`INC.,
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` Defendants.
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`ORDER ON DEFENDANTS’ MOTION FOR PROTECTIVE ORDER
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`Defendants Activision Blizzard, Inc., Blizzard Entertainment,
`Inc., and Activision Publishing, Inc. (referred to collectively in
`the singular as “Activision”) seek a protective order preventing
`Plaintiff Worlds, Inc. (Worlds) from obtaining discovery bearing
`on whether Activision was or is a real-party-in-interest (“RPI”)
`to several petitions Bungie, Inc., filed in connection with an
`inter partes review (“IPR”) before the Patent Trial and Appeals
`Board (PTAB). (D. 292). Worlds contends that several of the
`patents at issue in this suit were also at issue in the IPR, and
`Activision may be barred from asserting certain affirmative
`defenses here if it was an RPI and failed to raise the defenses
`there. For the reasons that follow, the motion for a protective
`order is allowed, subject to one caveat as noted.
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`Patent Owner's Exhibit 2004
`Page 1 of 7
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`UNITED STATES DISTRICT COURT
`DISTRICT OF MASSACHUSETTS
`
`
`
`
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`
`
`
`
`No. 12-CV-10576-DJC
`
`
`
`
`
`WORLDS, INC.,
` Plaintiff,
`
`v.
`
`ACTIVISION BLIZZARD, INC.,
`BLIZZARD ENTERTAINMENT, INC.,
`and ACTIVISION PUBLISHING,
`INC.,
`
`
`
` Defendants.
`
`
`
`
`
`
`
`
`
`ORDER ON DEFENDANTS’ MOTION FOR PROTECTIVE ORDER
`
`Defendants Activision Blizzard, Inc., Blizzard Entertainment,
`Inc., and Activision Publishing, Inc. (referred to collectively in
`the singular as “Activision”) seek a protective order preventing
`Plaintiff Worlds, Inc. (Worlds) from obtaining discovery bearing
`on whether Activision was or is a real-party-in-interest (“RPI”)
`to several petitions Bungie, Inc., filed in connection with an
`inter partes review (“IPR”) before the Patent Trial and Appeals
`Board (PTAB). (D. 292). Worlds contends that several of the
`patents at issue in this suit were also at issue in the IPR, and
`Activision may be barred from asserting certain affirmative
`defenses here if it was an RPI and failed to raise the defenses
`there. For the reasons that follow, the motion for a protective
`order is allowed, subject to one caveat as noted.
`
`Patent Owner's Exhibit 2004
`Page 1 of 7
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`Case 1:12-cv-10576-DJC Document 343 Filed 03/04/21 Page 2 of 7
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`For context, the present suit, filed in 2012, was stayed by
`agreement in 2015 to allow for the PTAB to resolve a series of
`petitions filed by Bungie seeking to invalidate six of Worlds’
`patents, some of which are also at issue in this suit. In
`agreeing to stay the case, the parties agreed that they would:
`stipulate and agree to be bound in this lawsuit by the
`PTAB’s final written decisions on Bungie’s IPR Petitions
`as to the specific invalidity grounds adjudicated in the
`final written decisions.
`
`(D. 197).
`Worlds argued inter alia in the IPR that Bungie should have
`named Activision as an RPI to its petitions, which, if done,
`might have rendered one or more of Bungie’s claims time-barred.
`The PTAB rejected this contention and invalidated three patents
`that are pertinent here. Worlds appealed and the Federal
`Circuit vacated in part and remanded the matter to the PTAB for
`further consideration of the RPI issue. See Worlds Inc. v.
`Bungie, Inc., 903 F.3d 1237 (Fed. Cir. 2018). The PTAB found on
`remand that Bungie and Activision had a “preexisting,
`established relationship” and that Activision was a “clear
`beneficiary of the filing of the Petitions.” Bungie, Inc. v.
`Worlds, Inc., IPR Nos. 2015-01264, -01319, -01321, Paper 64 at
`45 (P.T.A.B January 14, 2020). Bungie’s remaining claims were
`terminated as being time-barred (without a final written
`decision) because Bungie did not meet the burden of
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`Patent Owner's Exhibit 2004
`Page 2 of 7
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`Case 1:12-cv-10576-DJC Document 343 Filed 03/04/21 Page 3 of 7
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`demonstrating that Activision, who had been served with a
`complaint more than one year prior to the filing of the IPR, was
`not an RPI.
`Against that backdrop, fact discovery resumed in this case
`in April 2020. (D. 264). In seeking the discovery at issue,
`Worlds argues that it matters whether Activision was an RPI to
`Bungie’s petitions because Activision contends the patents at
`issue here are invalid, and an IPR petitioner’s RPI is estopped
`from asserting in civil litigation that a “claim is invalid on
`any ground that the petitioner raised or reasonably could have
`raised during that inter partes review.” 315 U.S.C. §
`315(e)(2). Worlds argues that Activision may be estopped from
`raising certain defenses here if it is an RPI to Bungie’s IPR
`petitions and raises defenses here that Bungie raised or could
`have raised previously.
`As a threshold matter, Activision’s status as an RPI would
`appear to be relevant in light of the prior litigation before
`the PTAB and Federal Circuit, the potential applicability of
`section 315(e), and, to a lesser degree, Activision’s noted
`reluctance to state plainly its relationship to Bungie.
`Activision advances two reasons why discovery bearing on its
`relationship to Bungie should nonetheless not be required.
`Activision argues first that the parties’ 2015 stipulation
`to be bound by any PTAB ruling on the merits as to the
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`Patent Owner's Exhibit 2004
`Page 3 of 7
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`Case 1:12-cv-10576-DJC Document 343 Filed 03/04/21 Page 4 of 7
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`invalidity of any of the patents at issue in this case was
`intended to encompass the entire scope of the parties’ agreement
`on estoppel, rendering § 315(e) inapplicable and making its
`relationship to Bungie a non-issue. However, Activision has
`offered no compelling evidence beyond its own contention to
`persuade the court that the parties intended to fully decide the
`potential applicability of § 315(e) through their 2015
`stipulation. In any event, the parties acknowledge that the
`presiding judge is prepared to determine the full scope of
`estoppel in this case at a later date. (D. 264) (“Dispositive
`motions (can address estoppel issue if still disputed)/Daubert
`motions due May 13, 2021.”). The court thus does not find the
`2015 stipulation to be a basis for the requested protective
`order.
`However, Activision, following on a question posed by the
`court, stated that it is prepared “for the purposes of
`determining the scope of prior art estoppel...not [to] dispute
`they were real-parties-in-interest (“RPIs”) to the inter partes
`review (“IPR”) petitions filed by Bungie, Inc,” mooting the need
`to conduct any discovery on the issue. (D. 319 at 1).
`In the court’s view, this concession, if adopted, would,
`with one caveat noted below, moot the plaintiff’s need for the
`requested discovery. Specifically, if Activision were to
`concede for purposes of this suit that it was an RPI to Bungie’s
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`Patent Owner's Exhibit 2004
`Page 4 of 7
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`Case 1:12-cv-10576-DJC Document 343 Filed 03/04/21 Page 5 of 7
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`IPR petitions, the plaintiff would not need discovery bearing on
`the same. Worlds would be free to argue the ramifications of
`that fact in future filings and the case writ large, including
`its contention that Activision should as a result be barred from
`raising certain affirmative defenses. Consequently, allowing
`discovery on this issue would not be proportional to the needs
`of this case and would impose an undue burden on the defendant.
`Less significantly, discovery would also not be in the interest
`of judicial economy where Activision has represented that it
`would otherwise challenge the production of some discovery as
`protected by either the attorney-client or common interest
`privilege.
`To be sure, Worlds argues that the requested discovery
`remains relevant even with the offered concession, because it
`may bear on questions of Activision’s willfulness, the
`plaintiff’s damages, and “exceptional case” attorney’s fees.
`The court does not presently agree.
`As it relates to willfulness, Activision has stated that it
`is not aware of any communications with Bungie relating to any
`of the accused products. (D. 319 at 4). On the issue of
`damages, the court agrees with Activision that Worlds has not
`articulated a plausible theory as to how Bungie’s
`indemnification obligations as to a non-accused game might bear
`on any damages in this case. Finally, it would be premature to
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`Patent Owner's Exhibit 2004
`Page 5 of 7
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`Case 1:12-cv-10576-DJC Document 343 Filed 03/04/21 Page 6 of 7
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`engage in “exceptional case” discovery at this stage for the
`reasons set out in Activision’s response to the plaintiff’s
`supplemental filing. See, e.g., Cornell Rsch. Found., Inc. v.
`Hewlett-Packard Co., No. 5:01-cv-1974 (NAM/DEP), 2006 WL
`5097357, at *7 (N.D.N.Y. Nov. 13, 2006) (denying plaintiff’s
`efforts to seek “exceptional case”-related discovery because
`“[e]xamination into the possibility of collaboration between HP
`and IBM and/or Intel in addressing plaintiffs’ discovery demands
`poses an unnecessary distraction which can serve only to divert
`the parties’ attention away from the truly relevant substantive
`issues in the case”).
`Accordingly, the court will allow Activision’s motion for a
`protective order in light of its offered concession, subject to
`the following caveat. As worded, Activision presently offers to
`concede it is an RPI to Bungie’s IPR petitions “for the purposes
`of determining the scope of prior art estoppel.” Whether this
`phraseology ostensibly limiting the impact of the concession to
`prior art is by design or is just descriptive surplusage
`articulating Activision’s sense of the practical impact of the
`concession, it is not hard to imagine that the phrase could at
`some point unnecessarily invite litigation, and the better
`course is to omit it. Indeed, any concession should be stated
`as simply and unqualifiedly as possible where the concession is
`being made to moot discovery that might otherwise be
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`Patent Owner's Exhibit 2004
`Page 6 of 7
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`Case 1:12-cv-10576-DJC Document 343 Filed 03/04/21 Page 7 of 7
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`discoverable for a variety of reasons, and the concession is
`already limited to this case only.
`Accordingly, the following is to be considered the law of
`this case and will bind Activision from taking any contrary
`position in this case:
`Activision Blizzard, Inc., Blizzard Entertainment, Inc.,
`and Activision Publishing, Inc., admit for purposes of
`the present action that they were real-parties-in-
`interest to the inter partes review petitions filed in
`May and June of 2015 by Bungie, Inc., concerning patents
`held by Worlds Inc.
`The court will assume that Activision assents to this
`concession as worded if no objection is made within five (5)
`days of this Order. Should Activision object, the court would
`most likely order that the RPI discovery be produced as
`requested, subject of course to any other applicable
`restrictions or arguments militating against disclosure. The
`plaintiff may also seek relief from this Order at a later stage
`of the case if there is a compelling reason to engage in narrow
`discovery, such as the need to definitively establish a date a
`certain action was or was not taken by Activision or Bungie.
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`/s/ Donald L. Cabell
`DONALD L. CABELL, U.S.M.J.
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`SO ORDERED.
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`DATED: March 4, 2021
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`Patent Owner's Exhibit 2004
`Page 7 of 7
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